Wall Street Waffles on Divergent Data

Discussion in 'Data Sets and Feeds' started by universaltrader, Apr 13, 2007.

  1. Friday April 13, 10:53 am ET
    By Joe Bel Bruno, AP Business Writer
    Stocks Waffle As Data Shows Consumer Confidence Sinking, Wholesale Inflation Staying Moderate

    NEW YORK (AP) -- Wall Street waffled Friday as a slide in consumer confidence heightened investor concerns about the economy but the government's wholesale inflation report eased some fears of higher interest rates.

    Investors became discouraged after the University of Michigan's consumer sentiment index weakened in early April, falling to 85.3 from 88.4 in March. That was below the market's expectation of a reading of 87.0.

    The report initially wiped out modest gains from earlier in the session that followed the Labor Department's report that its Producer Price Index was flat in March after stripping out the more volatile prices for energy and food. Overall, wholesale prices shot up 1 percent due to more expensive gasoline and food.

    But the market regained some lost ground as investors tried to make sense of conflicting economic signals. They're concerned about the economy in two regards: that the Federal Reserve will raise interest rates to contain inflation, and that economic growth is being stymied by the slumping housing market, rising energy prices and other factors. Although Friday's inflation report appeared to remove some pressure on the Fed to raise rates, the notion of slower consumer spending, which could have a big impact on the economy, led many investors to take money out of the market.

    In midmorning trading, the Dow Jones industrial average was up 10.98, or 0.09 percent, at 12,563.94.

    Broader stock indicators declined. The Standard & Poor's 500 index was up 0.29, or 0.02 percent, at 1,448.09, and the Nasdaq composite index fell 4.79, or 0.19 percent, to 2,475.53.

    Bonds rose slightly, with the yield on the benchmark 10-year Treasury note falling to 4.73 percent from 4.74 percent late Thursday. The dollar was mixed against other major currencies, while gold prices moved higher.

    Oil prices fell after a rally Thursday when the International Energy Agency reported that world oil output declined in March. A barrel of light sweet crude fell 14 cents to $63.71 on the New York Mercantile Exchange.

    A report from the Commerce Department that the U.S. trade deficit improved for a second straight month gave some support to stocks.

    In corporate news, General Electric Co. rose 10 cents to $35.28 after it posted first-quarter results that matched Wall Street projections. However, the conglomerate said profit in one of its businesses was "tempered" by its U.S. mortgage business because of subprime loans.

    Apple Inc. said it would delay the release of Leopard, the next upgrade of its Mac operating system, until October. Leopard was originally scheduled to be released in early June. Shares fell $1.39 to $90.80.

    SLM Corp., the biggest U.S. provider of student loans that is better known as Sallie Mae, is in talks with buyout firms and may be bought for more than $20 billion, according to a report in The New York Times. Its stock soared $4.96, or 12.2 percent, at $45.71.

    Dyax Corp. rose $2.50, or 62.5 percent, to $6.50 after the biopharmaceutical company said its genetic disease drug met its main goal in a late stage trial. Meanwhile, Merck & Co. rose $3.09, or 6.7 percent, to $49.45 after the drugmaker raised their profit outlook for 2007.

    In other corporate news, Morgan Stanley bought 13 hotels from Japanese carrier All Nippon Airways Co. for about $2.4 billion. The deal roughly doubles the investment bank's portfolio of hotels in Japan. Morgan Stanley rose 37 cents to $80.44.

    The Russell 2000 index of smaller companies was down 0.88, or 0.11 percent, at 814.17.

    Overseas, Japan's Nikkei stock average closed down 1.01 percent. In afternoon trading, Britain's FTSE 100 was up 0.24 percent, Germany's DAX index added 0.38 percent, and France's CAC-40 was rose 0.31 percent.
  2. Absolutely bullish don't you agree? :p